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3 Reasons Why Purchasing A Company-Owned Gym Might Be Right For You

Mar 25, 2021

Buying a company-owned gym | Inside Franchise Business

In the fitness industry, sometimes the fitness franchise opportunity can present itself to buy a site owned and operated by the franchisor and these company-owned sites can present a different value proposition when compared to a greenfield site (or an existing site from another franchisee), so it’s worth considering the differences.

Company-owned gyms and other fitness facilities can become available for a number of reasons. It could be that all of the clubs in the network were originally company-owned or perhaps the franchisor chose to do a buy-back of a particular site from an independent.

Whatever the reason, they often become available, are usually positioned at a higher price point due to profitability and should be considered with the same careful and thorough eye as you would any business opportunity.

Here are the top three reasons why you might look at buying a company-owned gym:

It’s the location you want

The location of a gym can be a very important part of its success, so if a company-owned site presents the opportunity to secure the location you really want, this may make it the perfect choice.

You want to eliminate some risk

The purchase of a new franchise (or any new business, for that matter) always comes with some level of risk, but some of this is eliminated when buying an established company-owned site.

You have the assurance that the club was run in-line with the franchise brand and processes, you know the fitness equipment has been well maintained and you will have a clear picture of how successfully the business is operating with trusted historical data and figures to review.

In the competitive industry of fitness, this can be a real advantage.

You want to fast-track the set-up

A lot goes into fitting out and establishing a gym – council/DA approvals, a well-negotiated commercial lease, extensive equipment and a sizable base of staff.

Buying an established site from the franchisor eliminates many of those steps while also offering some security with an established member base, professionally selected staff and an established income.

Here are three questions to throw into the mix when doing your research of a company-owned franchise:

  1. Why is the franchisor selling?
  2. Is the lease staying with the franchisor or is it being assigned as part of the sale?
  3. How old is the fitness equipment? (Most equipment has a lifespan and needs to be revamped over time, so ask the question and you may even be able to use it as bargaining power)

Source: Franchisebusiness

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